Wednesday, 23 December 2009

Software licences: better than IP rights?

The Software License Unveiled: How Legislation by License Controls Software Access is a short, vibrant book by Douglas E. Phillips (Vice President and General Counsel, Promontory Interfinanciary Network). The web-blurb makes some big claims for it, describing it as follows:

"* First title to combine a practice-oriented survey of "clickwrap" law with a theoretical treatment of legal and economic theory;* Written by a visionary legal practitioner with extensive experience in software licensing;* Includes discussion of today's software licenses from both practical and conceptual vantage points, including analysis of license examples, discussion of key judicial decisions, and consideration of theoretical perspectives;* Explains how the terms of "clickwrap" agreements and other software licenses give rise to a largely unread and unseen law of software, which often displaces intellectual property law;* Discusses digital rights management ("DRM") and the Digital Millennium Copyright Act ("DMCA") and how these critical developments are and are not related to software licensing;* Discusses the new version 3 of the General Public License ("GPL"), which applies to Linux and other free software programs;* Includes a brilliant new perspective on the proliferation of open-source software licenses that will help to frame the ongoing debate within the free and open-source software communities.

Nearly every use of a computer is subject not only to public intellectual property law, but also to the privately-written law of the software license. Although the United States has only one Copyright Act and one set of patent laws, there exist thousands of different licenses - to which millions of computer users legally bind themselves by the click of a mouse, usually without reading anything but the word "agree." How do these proliferating but largely unread licenses affect access to software, one of the economy's most valuable resources? In The Software License Unveiled, visionary practitioner Doug Phillips aims to illuminate the unseen law of software to which the software license gives rise".

Words like 'brilliant' and 'visionary' tell us less about the author and his book than they do about the fact that this work is published from Oxford University Press's New York office rather than from the genteel and discreetly understated grandeur of its Jericho headquarters. American purchasers of IP books are presumably more habituated to hyperbole than are their European brethren and may be disconcerted by its absence.

The phenomenon of the software licence, in its shrink-wrap, web-wrap, browse-wrap and click-wrap guises, has been well known to software lawyers and their clients since the dawn of mass-market PC time (the facts of the early shrink-wrap litigation inProCD v Zeidenberg took place in 1994, when dinosaurs ruled the information highway and most people still used DOS), though it has been rediscovered with great regularity: as recently as 2007 the prophetic Cory Doctorow could still persuade readers that shrink-wrap licences were "an epidemic of lawsuits waiting to happen".

Doug Phillips has not invented, nor re-invented, concerns regarding software licences of this nature. What he has done, however, is to explain lucidly and enthusiastically, why contract law -- if allowed free rein -- is a far more effective way for a business to protect its rights, control the use of its products and manipulate its relationships with users of its products than are the intellectual property rights that vest in it. Patents can be invalidated and are horrendous to litigate, copyrights can be worked around, trade marks are no serious hazard -- but if you can point to an obligation that you wish to press upon someone else and say, "Look, you've agreed to this and you can't deny it", you are in a far more powerful position. Doug Phillips has not lifted the veil on software licences but he has enabled readers to see clearly through it. In doing so, he has given some clear background to the reasons why you-must-have-agreed licensing provides so much comfort and security to those who invest in new software products.

IP Finance ...

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